The Net Neutrality Battle Has Been Lost

But now we can finally win the war.

The D.C. Circuit Court of Appeals just issued its long-awaited decision striking down the FCC’s network neutrality rule. This is the second time in four years that this court struck down the FCC’s attempt to adopt a network neutrality rule. It is now legal for AT&T or Verizon to block Slate, your blog, or any other site.

Even though the Internet touches every part of our lives, one person is to blame for potentially destroying its potential for innovation and freedom of expression: former FCC Chairman Julius Genachowski.

The court loss was even more emphatic and disastrous than anyone expected. But this defeat comes with a silver lining: It may force the new FCC chairman to act.

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“Network neutrality” is sometimes called “Internet freedom” or “Internet openness” and is a legal principle that would forbid cable and phone companies like AT&T, Verizon, and Comcast from blocking some websites or providing special priority to others. It would forbid Comcast from blocking Facebook or Bing. It would forbid Verizon from, say, charging the Huffington Post for special service to load more quickly than Slate.

Without network neutrality, cable and phone companies could stifle innovation. Imagine if, years ago, MySpace or AltaVista had cut deals with cable companies to block Facebook and Google. Without network neutrality, telecom and cable companies could also stifle free expression. They’d have the legal right to block articles like this one.

The court today struck down the two most important net neutrality rules: one that prevented discrimination in favor of or against websites, and one against outright blocking. The only part left standing is the requirement that carriers disclose when they’re engaging in discrimination and blocking. But most users only have a choice between one cable company and one phone company, so the market alone can’t ensure network neutrality.

The loss was so definitive, the powers granted to cable and phone companies so outrageous, that the FCC has a live grenade in its lap.

The war over network neutrality has raged for at least nine years and was even the centerpiece of Barack Obama’s technology agenda during the 2008 campaign. But it’s part of a broader history of fighting for freedom of expression for every new technology dating back to newspapers, telegraphs, radio, and television.

Everyone knew we were going to lose this case. In 2007 the American public discovered that Comcast, the nation’s largest cable provider, was blocking several basic, legal Internet technologies enabling peer-to-peer transactions. In response to complaints, the FCC ordered Comcast to stop. Comcast appealed to the D.C. Circuit, and that court ruled in 2010 that the FCC didn’t have the jurisdiction to act.

That decision, called Comcast v. FCC, made it clear what the FCC would need to do to have the jurisdiction to try again to enforce network neutrality. Congress gave the FCC the power to regulate “telecommunications services” (which many believe include the Internet services provided by cable and phone companies) but not “information services” (which everyone agrees includes Twitter, Google, and other services riding on top of the Internet lines). That is, the FCC can regulate cable and phone networks but not apps and websites. The deregulatory FCC of 2002, however, had a chairman who is now the head lobbyist for the cable industry, and he succeeded in removing regulations for the cable industry by classifying cable Internet as an “information service,” the category for Twitter and Slate. The court was unimpressed: If the FCC wanted to regulate cable companies but not Twitter and Slate, it had to put them in different categories, or else the FCC could start regulating Twitter and Slate.

On behalf of consumer groups and technology companies, I joined the FCC’s general counsel at the time in arguing that Comcast case back in 2010 before the D.C. Circuit. As with today’s ruling, it was disappointing when we lost that case, but at least we seemed to have a clear roadmap to fix the mess we were in. All the FCC had to do back in 2010 was clarify that Internet service offered by cable and phone companies is a “telecommunications service,” and to “reclassify” it as such. That would require reversing a few of the earlier orders but would have likely been upheld in court. And presto: Internet freedom preserved.

The FCC appeared poised to do just that. By the time the D.C. Circuit struck down the FCC’s Comcast order, however, the commission had a new chairman, a Democrat named Julius Genachowski. Genachowski was a former FCC lawyer who had been among the biggest fundraisers for his Harvard classmate Barack Obama. Even though there are five FCC commissioners, the chairman sets the agenda and largely controls the budget and staffing of the entire agency. So it was good news when Genachowski made a YouTube video explaining why he had to reclassify Internet services to ensure an open Internet and asked his general counsel to explain the legalities in a widely shared FCC blog post.

Even though he and his general counsel promised to reclassify Internet service, Genachowski essentially caved as the cable and phone companies unsurprisingly continued to oppose network neutrality. The do-nothing, gridlocked Congress failed to bail him out, so he cut a deal with AT&T a few months after the Comcast order back in 2010. The result of that deal: a network neutrality order issued in December 2010, which was struck down today, that was full of loopholes, including exemptions for the now-dominant way of accessing the Internet (mobile). Most importantly, he didn’t reclassify, so his order was essentially designed to collapse. (That is why AT&T has supported the order and never sued to oppose it.)

If this reminds you of the scene in the Harry Potter books when the coward Peter Pettigrew, who had immense power as James Potter’s secret-keeper, makes a deal with Voldemort and betrays the wizarding world, it should.

Those of us who had been involved with the net neutrality debate knew that, without reclassification, the flawed FCC order would never stand. But there were 100 ways it could have fallen. I thought that the court’s decision would be a baby-splitting half-loss that could enable the FCC to wipe its hands of network neutrality and pretend everything was A-OK.

I was wrong on that point. The loss was so definitive, the powers granted to cable and phone companies so outrageous, that the FCC has a live grenade in its lap.

Now, every side is settling on its narrative. AT&T, Verizon, and their allies will argue that the decision means network neutrality is illegal, full stop, and the FCC can never adopt an order. They will also argue that the FCC needs to go to Congress to get more authority. Both arguments are wrong, of course. The FCC has all the power it needs to clean up the mess, simply by doing what Genachowski—who, it must be said, is a very nice guy—knew he had to do but lacked the spine for.

The bigger question is what the FCC—and advocates of network neutrality—will do. The current FCC chairman, Tom Wheeler, is highly regarded, but some distrust him because he is the former head lobbyist of both the cable and wireless phone industries. He’s also made some statements suggesting he doesn’t understand or opposes network neutrality. Worse, there are those at the FCC who appear to see network neutrality as a brutal war that they would prefer to avoid if possible. Finally, Google, Netflix, Mozilla, eBay, IAC, and other tech companies that have long supported network neutrality seem to have lost a bit of their appetite for a fight. (I advise several technology companies but am not speaking for any of them here.)

Top Comment

And here I was thinking that I couldn't possibly feel any more contemptuous toward the cable and phone companies (or our federal government and its seemingly ineffective agencies that are supposed to protect the public's interests in these matters). More...

The only people who remain completely committed to network neutrality and energized to defend it are consumer groups and average Americans who love the Internet. On Reddit, Facebook, and Twitter, people are asking how to reverse the decision and preserve Internet freedom. In Washington, though, having the American public on your side might not be enough to stare down the hundreds of telecom and cable lobbyists. That’s where the consumer groups come in. For many years, organizations like Free Press, the New America Foundation’s Open Technology Institute, Public Knowledge, and others have been active on this issue. (Disclosure: I’m affiliated with or have donated to all of them.) Now, they need to rebuild the coalition with tech companies serving millions of network neutrality supporters and organize the public for a fight—something that’s possible so long as Verizon and AT&T don’t exercise their newfound right to block any website they choose.